M-100 The Essentials of community
association management Questions
with 100% Correct Answers
community association Correct Answer: legal entity in which the owners enjoy
the protection, enhancement, maintenance & preservation of their homes &
property
community association has 3 defining characteristics Correct Answer:
Membership in the community is mandatory & automatic for all owners; certain
association docs bind the owner & the association to each other through
mandated actions; mandatory lien-based assessments (maintenance fees) are
levied on each owner in order to operate & maintain the community assocation
lien Correct Answer: legal claim by one party (community association) on the
property of another (delinquent owner) to obtain the payment of a debt or the
satisfaction of an obligation.
What does the lien do? Correct Answer: Placing a lien on an owner's property
protects the community association's interests. It encourages payment of the
debt. Consequence of lien is the owner cant sell or transfer the unit without
settling the debt.
Purpose of a community assocation Correct Answer: to provide for the
community, business, & governance aspects of the association. This is achieved
by administering, maintaining, & enhancing a residential real estate
development, and through the establishment of a system of property rights,
binding covenants & restrictions, & rules & regulations.
3 basic types of residential community associations (1) Correct Answer: Planned
community; owner owns his unit ; community owns any common areas such as
tennis courts, for the use & benefit of the lot owners
, second type Correct Answer: Condominium; owner owns his living unit & an
undivided interest in the common elements of the community. Each owner
owns a % of the common elements, which consist of everything except the
living units.
third type Correct Answer: Cooperative; person owns stock or membership;
holds a proprietary lease or occupancy agreement for his living unit
Proprietary lease or occupancy agreement Correct Answer: defines the
member or stockholders' rights & obligations in relation to the living unit. The
community association owns all of the real estate as a not-for-profit corporation.
3 types of residential community associations can exist by themselves or can be
group in clusters called: Correct Answer: Master or umbrella associations:
consists of more than 1 residential community association.
Second type Correct Answer: Mixed-use development-consists of a mixture of
residential & commercial &/or industrial uses grouped together.
Third type Correct Answer: 55 & older communities; must have 1 person who is
55 of age or older living in at least 80% of occupied units.
Sources of legal obligations for a community association Correct Answer:
Federal, state & local statues, regulations, & case law
second source Correct Answer: legal documents unique to the community
association that bind the association & its owners
third source Correct Answer: lender requirements; requirements set by
secondary institutions (ex; FHA, Fannie Mae)
fourth source Correct Answer: standards set by professional bodies; ex: auditing
standards set the American Institute of CPAs
association management Questions
with 100% Correct Answers
community association Correct Answer: legal entity in which the owners enjoy
the protection, enhancement, maintenance & preservation of their homes &
property
community association has 3 defining characteristics Correct Answer:
Membership in the community is mandatory & automatic for all owners; certain
association docs bind the owner & the association to each other through
mandated actions; mandatory lien-based assessments (maintenance fees) are
levied on each owner in order to operate & maintain the community assocation
lien Correct Answer: legal claim by one party (community association) on the
property of another (delinquent owner) to obtain the payment of a debt or the
satisfaction of an obligation.
What does the lien do? Correct Answer: Placing a lien on an owner's property
protects the community association's interests. It encourages payment of the
debt. Consequence of lien is the owner cant sell or transfer the unit without
settling the debt.
Purpose of a community assocation Correct Answer: to provide for the
community, business, & governance aspects of the association. This is achieved
by administering, maintaining, & enhancing a residential real estate
development, and through the establishment of a system of property rights,
binding covenants & restrictions, & rules & regulations.
3 basic types of residential community associations (1) Correct Answer: Planned
community; owner owns his unit ; community owns any common areas such as
tennis courts, for the use & benefit of the lot owners
, second type Correct Answer: Condominium; owner owns his living unit & an
undivided interest in the common elements of the community. Each owner
owns a % of the common elements, which consist of everything except the
living units.
third type Correct Answer: Cooperative; person owns stock or membership;
holds a proprietary lease or occupancy agreement for his living unit
Proprietary lease or occupancy agreement Correct Answer: defines the
member or stockholders' rights & obligations in relation to the living unit. The
community association owns all of the real estate as a not-for-profit corporation.
3 types of residential community associations can exist by themselves or can be
group in clusters called: Correct Answer: Master or umbrella associations:
consists of more than 1 residential community association.
Second type Correct Answer: Mixed-use development-consists of a mixture of
residential & commercial &/or industrial uses grouped together.
Third type Correct Answer: 55 & older communities; must have 1 person who is
55 of age or older living in at least 80% of occupied units.
Sources of legal obligations for a community association Correct Answer:
Federal, state & local statues, regulations, & case law
second source Correct Answer: legal documents unique to the community
association that bind the association & its owners
third source Correct Answer: lender requirements; requirements set by
secondary institutions (ex; FHA, Fannie Mae)
fourth source Correct Answer: standards set by professional bodies; ex: auditing
standards set the American Institute of CPAs
